How this skincare brand finds sweet spot between mass & premium Ayurveda market

The brand and its promoters are firm believers of 'Beauty Inside is Beauty Outside'. And with this belief T.A.C - The Ayurveda Co has embarked on a journey to popularize the pure, unadulterated Ayurvedic value in households across the globe in 2021. It is already one of the fastest-growing omnichannel brands in the beauty and wellness sector, providing ethically crafted, premium and eco-conscious personal and healthcare products at mass prices. The primary aim of T.A.C is– HEAL (Helping Enable Ayurveda Life). With an extensive collection of ayurvedic formulations bottled with care to suit the current times, T.A.C has achieved a 200 per cent growth rate in a very short stint. The research behind formulating the products is based on the science of healing rather than just instant gratification and creating an illusion of outward results. Supported by a $3 million funding from Wipro Consumer Care Backed Venture, the company is now charting out the next phase of growth.

Speaking to Bizz Buzz exclusively, Shreedha Singh, Co-founder & CEO, and Param Bhargava, Founder, T.A.C - The Ayurveda Company, both of whom are followers of the holistic wellbeing of body, mind and soul, achieved through the lineage of Ayurveda decode the Ayurvedic beauty product market - outline their growth plans.

How big is the overall Ayurvedic beauty and wellness products market in India? At what rate is it growing?

Singh: Ayurvedic beauty and wellness market is the subset of larger beauty and wellness market. Beauty, personal care, health and wellness market is overall at $30 billion that is growing at CAGR of 16 per cent. Within that, ayurvedic market is currently around $7 billion and Ayurveda market is growing faster at a pace of 21 per cent CAGR than beauty market.

There are many unorganised sector products in this category. How is the organised sector eating into the unorganised sector and growing their market?

Singh: In the organized sector, there has been a consistent tremendous growth since the last 2 years. There has been a great adoption of technology since Covid-19. The amount of content consumption increased, along with new consumer across India including tier 2 and tier 3 cities.

Within the Ayurveda market, there has been a gap – either the ayurveda brands have been portraying ayurveda as premium and expensive or mass market with average quality. This gave us an opportunity to build premium product quality with high standards of ayurveda recipes at affordable prices. This created fast adoption for T.A.C across the nation, even in tier-2 and tier-3 cities and allowed to eat a lot of market from the existing ayurvedic brands.

Where is this segment growing faster - urban or rural?

Singh: Tier-2 and Tier-3 markets of India are growing faster than Tier-1.

How is TAC as a brand growing? What would be TAC's market share in the segment at this point in time? What is the market share you are looking at two-three years down the road?

Singh: T.A.C is one of the fastest growing D2C FMCG Ayurvedic brands in India. Within six months T.A.C has become an omnichannel format brand from being an e-commerce exclusive format.

There has been a consistent growth of 25-30 per cent at month-on-month basis in the last 15 months of T.A.C's inception. At this point, the market share is still small as we've just started this journey. Currently, we would be at 0.1 per cent of the overall Ayurveda market which is $7 billion. In the next 3-5 years, we expect to create a larger market for the portfolio and acquire a sizeable chunk of 10 per cent in the Ayurveda market of the country.

How do you position the brand- premium/upmarket/ mid-segment/mass market?

Bhargava: We are a mid-segment brand. T.A.C- The Ayurveda Company is mass-market brand. T.A.C is the result of the gap that Ayurveda market of India contained. T.A.C is on a mission to create and build a masstige D2C Omni Ayurveda segment. We as a brand, identified a large gap in the entire ayurveda market currently in India.

What is this gap?

Overall, the ayurveda market wasn't expanding because it wasn't adopted and consumed by the younger generation of India.

Reason: People think that ayurveda is slow, ineffective and has no certification as such.

The market of Ayurveda brands is segregated between two price brackets – old, legacy brands such as Dabur, Patanjali that operates at Rs 120-180 per product. This price point is cost-effective, but cannot provide high-quality, premium products to meet the new age consumer's expectations. On the other hand, premium, luxury ayurvedic brands stands at Rs 1,000 and so on prices, that made ayurveda aspirational, but didn't boost the consumption at all.

T.A.C has bridged this gap between mass and premium ayurveda with a new category – mass premium ayurveda by bringing revolutionary, effective and affordable formulations for the young millennials, gen-z population of the country. This makes the said generation interested in ayurveda, and with experience of the products, builds the belief in traditional medicinal sciences of India, ultimately leading to the adoption of Ayurveda as a lifestyle.

We connect with our target audience through the tools at their disposal, such as social media handles and army of influencers who are rooted in believes of our brand at large. Going forward, we are building a digital clinic for Ayurveda consultation via web application for the new-age consumer.

How many products do you have under your portfolio? How many more do you plan to roll out each year in the coming few years?

Bhargava: Currently T.A.C has 100 unique SKUs currently spread across the categories of skin, hair, body, ayurvedic makeup and baby care. In the next 3-5 years, we expect to become a completely holistic ayurveda brand with at least 700-800 SKUs in all the categories of Ayurveda. We intent to become the go-to place for consumers for all the requirements related to ayurveda lifestyle or ayurvedic ingredients and products.

How do you sell your products- online/offline? What is the break-up of online-offline sales? Going forward, what would be the focus?

Bhargava: T.A.C is D2C Omnichannel ayurveda brand. We sell through all possible touchpoints that connect us to the consumer. For online, T.A.C is available at own D2C website, marketplaces like Myntra, Nykaa, Amazon, Flipkart etc. Apart from the mainstream, T.A.C is available at quick commerce apps like Blinkit, Zepto, 1 mg, Pharmeasy etc.

At an early stage of the brand, we have activated our offline retail, launching in June 2022. Since then, we have been able to open 20+ of our own EBO kiosks at the top malls of India. These kiosks are primarily designed as an experience centre for the customers, instilled with our beauty advisors to give them a glimpse of our products.

There has been a large push for our general trade and modern trade counters in the last four months. We are available with 300+ GT & MT stores, expecting to ramp up with number up to 1000 by end of the current financial year.

What about overseas sales? Which countries are you currently selling your products to? Are you looking at any new geographies/oversea locations? How much of your current revenue comes from the overseas market and how much from the domestic markets? What would be the break-up like, going forward?

Singh: T.A.C has just launched its export vertical with neighbouring countries namely Bangladesh, Nepal and Maldives. We strongly believe that there is going to be a great demand & potential for Ayurveda globally in the regions of USA, EU & UAE. In the next two to three quarters, we will expand the sales with global distributors & active E-Commerce with Amazon.com, Walmart and more.

Where do you have your manufacturing base/bases? Are you looking at any new manufacturing base?

Singh: Currently, we operate out of three unites set up in Delhi – NCR, Rohtak, Haryana and Dehradun. We are not looking at a new base at this point but strategically expanding our operations & investment in the existing facilities.

How much have you invested so far and how did you mobilise these funds? Do you have fresh funds?

Singh: We raised our seed fund round of about $3 mn from Mr. Azim Premji's Wipro Consumer Care Ventures in March 2022. Yes, now we are raising our next round- Series A with the larger consumer ventures of India. The round has been initiated with Actress Kajal Aggarwal, and is expected to close at up to $15 million.